Looking to add 12-16 new restaurants: Speciality

Speaking to CNBC-TV18's Latha Venkatesh and Sonia Shenoy, Chatterjee said their Global Grill, which includes Sigree and Machan, has been getting tremendous response. The company is also looking to add 12-16 new restaurant units for FY14.

According to Chatterjee, the company has to look beyond Mainland China, their flagship brand which forms the major part of the business.

As on December 31, 2013, Speciality has 90 restaurants and 14 confectionaries across 26 cities in the country. During the December quarter, the company opened five new restaurants and shut two.

Below is the verbatim transcript of Anjan Chatterjee, Co-founder & MD, Speciality Restaurants' interview with Latha Venkatesh & Sonia Shenoy on CNBC-TV18.

Sonia: Demand for companies like yours has been slowing down as we have seen consumer or rather discretionary spends slowing down in the last many quarters. Give us a sense of the way forward. What kind of demand situation are you expecting and in effect what kinds of revenue growth run rate can Speciality Restaurants eek out?

A: We have clocked a good topline and there are improvements on the EBITDA margin. So, these two factors actually give us lot of encouragement and we are in long-term play; we are not in a short-term play. However, you know what the economy has been and the discretionary spends have been very much under pressure, so in spite of all that because of the fact that the brand has tremendous level of pull and strength, we have been able to really leverage that and this kind of quarter has come in and we are extremely happy even the month of January has been very good, so going forward things will improve from here and everybody is waiting for government to be formed at the centre and looking forward to a political stability after which the overall sentiments have to change, we are not here for a short term.

Latha: Give us an idea of how your restaurant expansion is laid out for the next four quarters?

A: We had promised right from the beginning that we will be doing anywhere between 12-16 composition of our restaurants. We are just in the third quarter and in spite of all that we have done 16 restaurants. Going forward there will be two-three more additions coming in by Q4 and the expansion is absolutely on track accepting that we have been extremely careful about the place, the area and we do not want the new stores to drag  the earnings before interest, taxes, depreciation and amortisation (EBITDA) which has been the case in this kind of a economic pressure and we are careful that the rental model becomes revenue share and lots of people have been participating and our brands are now getting a lot of respect and every mall or real estate owner has a trust in the brand and going forward it will be better and better from here.

Latha: Same store sales grew, remained flat or fell quarter on quarter?

A: Flattish. Some of the stores have grown tremendously but overall it is flattish.

Sonia: What are the names of the restaurants that we can expect in the next year?

A: Mainland China being the main story and the flagship brand. Seventy percent of growth will be from Mainland China followed by other restaurants - Sigree has been consolidated into a Global Grill, so all the Indian brands are under one umbrella, Sigree Global Grill. Global Grill has shown tremendous potential and everywhere we are opening one we are getting very good response. The third one is Mizuna, which we have opened, which is the all day dinning. We are hands of full and there is huge potential in Mainland China even now because the 100 mark should be touched in next two financial years and that is what we are ensuring because the flagship brand has to grow across Mainland China in its own space of Chinese cuisine has consolidated itself and will further consolidate.